Economic losses from natural disasters topped US$232 billion in 2019 as the costliest decade on record ended, according to Aon’s latest catastrophe report.
2010 to 2019 marked the costliest decade on record with economic damage reaching US$2.98 trillion – some US$1.19 trillion higher than 2000-2009 and with Asia Pacific accounting for 44%. Private and public insurance entities paid out US$845 billion during the decade with the US accounting for 55% of claims alone.
In 2019 409 nat cats resulted in economic losses of US$232 billion. Insurance covered US$71 billion of the total – 6% above the century average but significantly lower than the record US$157 billion in 2017 and US$100 billion in 2018. This means the protection gap, which is the portion of economic losses not covered by insurance, was 69% in 2019 – the sixth-lowest since 2000.
The 12-months witnessed 41 US$1 billion or above economic loss events, and 12 US$1 billion insured loss events, with the two costliest insurance events Typhoon Hagibis and Typhoon Faxai occurring in Japan and causing US$9 billion and US$6 billion in insured losses respectively.
Monsoon rains led to a combined US$25 billion in flood-related damage in China (US$15 billion) and India (US$10 billion) alone; in addition bushfires raged across Australia.
Andy Marcell, chief executive of Aon’s Reinsurance Solutions, commented: “Following two costly back-to-back years for natural disasters in 2017 and 2018, there were several moderately large catastrophes [in 2019] but strong capitalisation has allowed the (re)insurance industry to comfortably manage recent losses.”
Climate change is clearly rising up the agenda.
Steve Bowen, director and meteorologist at Aon’s Impact Forecasting, said: “Scientific research indicates that climate change will continue to affect all types of weather phenomena and subsequently impact increasingly urbanised areas. As the public and private sectors balance an understanding of the science with smart business solutions, this will lead to new advances that lower the physical risk and improve overall awareness.”

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